Correlation Between Scout Mid and Carillon Scout

Can any of the company-specific risk be diversified away by investing in both Scout Mid and Carillon Scout at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Scout Mid and Carillon Scout into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Scout Mid Cap and Carillon Scout Small, you can compare the effects of market volatilities on Scout Mid and Carillon Scout and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Scout Mid with a short position of Carillon Scout. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scout Mid and Carillon Scout.

Diversification Opportunities for Scout Mid and Carillon Scout

0.95

Correlation Coefficient

Scout Mid  Carillon Scout

Almost no diversification

The 3 months correlation between Scout and Carillon is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Scout Mid Cap and Carillon Scout Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carillon Scout Small and Scout Mid is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Scout Mid Cap are associated (or correlated) with Carillon Scout. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carillon Scout Small has no effect on the direction of Scout Mid i.e., Scout Mid and Carillon Scout go up and down completely randomly.

Pair Corralation between Scout Mid and Carillon Scout

Assuming the 90 days horizon Scout Mid is expected to generate 1.77 times less return on investment than Carillon Scout. But when comparing it to its historical volatility, Scout Mid Cap is 1.47 times less risky than Carillon Scout. It trades about 0.14 of its potential returns per unit of risk. Carillon Scout Small is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  2,617  in Carillon Scout Small on May 1, 2025 and sell it today you would earn a total of  90.00  from holding Carillon Scout Small or generate 3.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Scout Mid Cap  vs.  Carillon Scout Small

Scout Mid Cap

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Scout Mid Cap are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak primary indicators, Scout Mid may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Carillon Scout Small

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Carillon Scout Small are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking indicators, Carillon Scout showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Scout Mid and Carillon Scout

The main advantage of trading using opposite Scout Mid and Carillon Scout positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scout Mid position performs unexpectedly, Carillon Scout can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Carillon Scout will offset losses from the drop in Carillon Scout's long position.

The idea behind Scout Mid Cap and Carillon Scout Small pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.